AI Agents and specifically AI crypto agents are on the rise and making their way to Linea. Now it's your turn to contribute and build your own version of AI on the world’s home network. We'll be offering hackathons on this subject throughout the year, starting with the hackathon we're organizing with Safe from February 3 to 14.

Here’s what you need to know about where the crypto bots everyone is talking about come from:

The Rise of AI Agents: A New Chapter

AI agents are not just simple bots following basic instructions. They are capable of learning, adapting based on data, conversing like a human and can be hyperactive 24/7 in the world of web3 and blockchain. Lately we’re seeing AI agents replying to tweets, buying and selling crypto, launching tokens, finding opportunities and then generating their own hype, often without getting any help from humans.

When we combine AI agents with the transparent and permissionless nature of blockchain, then we’ve got something mind-blowing.

Traditionally, traders relied on basic bots to buy and sell based on sets of simple rules like:“If Ether’s price goes below X, buy; but if it goes above Y then sell.” These bots served their rudimentary purpose. Today’s AI agents are their evolution: they don't just follow rules, they learn from data, respond to new information and modify strategies in real-time.

The web3 or crypto market never really sleeps. It’s more like a global party that keeps going, shifting in a blink with the next big altcoin or hot NFT project. Humans can’t stay awake forever, scanning X, Telegram, Discord, Youtube and price feeds. But an AI agent can thrive in this environment. It can monitor hundreds or thousands of tokens in parallel, track social hype or sentiments, watch crypto whale movements, scan news headlines and immediately execute trades or post social content without needing any human approval. This is what makes AI agents so special and valuable, but also intimidating.

The Technology Behind AI Agents

These abilities sound amazing, but how do AI agents actually accomplish these feats? Underneath the flashy social media presence and cunning trades is a core cycle that most AI agents follow:

1. Data Gathering: The AI agent hoovers up information from everywhere—crypto exchanges, Twitter, blockchain explorers, news websites—basically anything it can plug into. The more data it has, the better it can understand the market’s mood.

2. Analysis / Thinking: The AI agent uses machine learning to detect/figure out patterns, run analysis on social posts or even predict how any announcements might affect the prizes. Some advanced agents will incorporate reinforcement learning, tweaking their strategies based on successes (or failures) over time.

3. Decision Maker: Based on what the AI has learned, it decides what to do next. Buy more of a certain token? Short a different one? Post a tweet warning people about a potential scam? Or do nothing at all?

4. Action Taker: Finally, the agent executes the decision. This might mean placing an order on a decentralized exchange, tweeting to thousands of followers, or sending you a text alert that something big is brewing.

What Makes AI Agents Different from Old-School Bots

• They learn and evolve: If an AI agent’s strategy backfires, it can analyze the reasons and adjust future decisions.

• They understand context: AI agents can interpret natural language and emotions—something rule-based bots can’t do well.

• They can multi-task: Some AI agents engage in Twitter discourse while simultaneously sniffing out arbitrage opportunities or reading NFT metadata.

Building Your Own AI Agent on Linea

Now that you see what’s possible, the next question is: can you build one on Linea? The short answer: absolutely! You don’t need understanding of rocket science or decades of coding experience. Thanks to user-friendly frameworks and APIs, developing a basic AI agent is more accessible than ever.

1. Define Your Goal

   Are you creating a trading-focused AI agent?
   Do you want it to be community based, generating social media posts and building hype/marketing trends?
   Or something hybrid that does a little bit of both?

2. Pick Your Tools

   Eliza: An older, classic chatbot framework for simple experiments but yet really powerful.
   LangChain (Python): Great for chaining language model operations with data sources.
   OpenAI’s API: Provides powerful language models without heavy setup.
   Hugging Face Transformers: For those who want to dive into open-source NLP models and maybe fine-tune them for crypto data.

3. Gather Your Data

   Price feeds from online sources or exchanges.
   Blockchain data from explorers or on-chain analytics tools like Dune.
   Social media: Twitter API for sentiment analysis, Discord/Telegram bots for community chatter, Reddit for news and opinions.

4. Integrate Machine Learning or Rule-Based Logic

   Supervised / Unsupervised ML to detect patterns, possibly using a library like scikit-learn or PyTorch.
   Reinforcement Learning if you want the agent to learn through trial and error (great for trading).
   Rule-based if you want to keep things simpler at first (e.g., “If social sentiment is extremely bullish and volume is above X, buy.”)

5. Decision & Execution Layer

   Connect to exchanges via API keys to place real trades.
   Integrate Twitter, Discord, or Telegram for automated posting.
   Include alerts.

Common Pitfalls

• Overfitting: Your AI agent might do amazingly well on historical data but flop in live markets.

• Excessive Complexity: Don’t feel pressured to build everything at once; start small.

• Security Concerns: If your agent can place real trades, secure your API keys carefully.

• Ethical & Spammy Behavior: Try to avoid turning your AI agent into a spam bot.

Remember, if you’re excited to get started in the new world of AI agents on Linea, join the hackathon we're organizing with Safe from February 3 to 14.

You can also draw on our existing partners to create your own AIs:

• RSS3 will give you efficient access to a wide range of data, thanks to their data layer technology.

• Eternalai lets you add AI to your project with just a few lines of code. Check out their videos to find out more.

Now get building, meatbag!